ICAC recommends clean-up of mining licence system

ICAC has made 26 anti-corruption recommendations to tighten up the process for managing the state's coal resources.

In a scathing report, entitled Reducing the opportunities and incentives for corruption in the state's management of coal resources, ICAC says the current system for awarding mining licences could be corrupted.

It says valuable state assets and rights are transferred to private entities and some ministers have too much discretion.

Among the recommendations is the public auction of exploration licences and charging miners and gas explorers rent that increases exponentially the longer the company sits on a parcel of land.

Greens' MLC, Jeremy Buckingham, says the O'Farrell government must act quickly to clean up a process the community no longer believes is transparent.

"Barry O'Farrell has inherited a broken system from Labor, but he is perpetuating that system and the coal is not going away; the gas isn't going away," he said.

"It's not like this stuff is cheese and is going to go off; it sits in the ground and has done for millions of years, and what harm would there be in a two or three year wait to develop a framework for responsible mining in this state?"

On Thursday, Barry O'Farrell told Question Time anyone interested in "clean government" would welcome the latest report and recommendations from ICAC Commissioner David Ipp.

"The government will consider, probably as early as next week, the way in which we will seek to progress many of the recommendations made by Commissioner Ipp," he said.

The Chief Executive Officer of the NSW Minerals Council, Stephen Galilee, has also endorsed the recommendations.

Jeremy Buckingham says miners in the Gunnedah Basin would benefit from the changes and would have greater certainty.

"We believe the recommendation to go to auctions for these exploration licences is a good one that will benefit the state and we also support the recommendation that there be a rent paid for these exploration licences," he said.

"Mining companies, gas companies can't just sit there, sitting over people's land, their community, a region without paying some sort of price."

Mr Buckingham says there are significant exploration licences in the Gunnedah Basin region that must be properly examined.

"People have been concerned about the probity surrounding the Shenhua and BHP-Billiton licences, as examples in the New England North West, and also the granting of the Petroleum Exploration Licences," he said.

"They didn't factor in the socio-economic and environmental implications and ICAC is vindicating those people who have long had those concerns.